Thursday, 26 May 2016

Most of the
reaction to the 2016 Budget has been predictable. Government supporters laud it
as one of the greatest things since sliced bread, while the Opposition bemoans
it as do-nothing, and as always the interest groups lament that there is not
enough in it for their particular constituency. The racist xenophobes continue
to ignorantly insist it is all the fault of rampant immigration. All so
predictable, all so tedious, and ultimately all so pointless.

Any Budget by any
government, left or right, is a balancing act between what Ministers would like
to do intheir own portfolios; their
parties’ priorities; and, what the Minister of Finance thinks he can pay for.
Every now and then, a budget provides scope for standing back a little and
looking at overall policy requirements in a particular area.

There is such an
issue in the 2016 Budget. In recent years, successive governments have
struggled with how to fund new innovative medicines that are expensive and may
not be able to be funded within PHARMAC’s existing budget and criteria. The
debate over the breast cancer drug Herceptin in 2007-09 was one such example.
The upshot was that the government made specific funding available for
Herceptin in 2009. That intervention was not seen as especially successful, and
so, when the issue of the melanoma drug Keytruda arose earlier this year, the
government took a slightly different approach, confirmed in the Budget, of
providing more funding to PHARMAC which was then able to fund the similar
medicine, Opdivo.

However, both
these examples raise a broader issue in the context of the new and innovative
biologic medicines likely to become available in the next few years, that will
not only have a profound effect on the treatment of many currently
life-threatening conditions, but will be extremely expensive. As things stand
at the moment, PHARMAC would be forced to play another game of catch-up, harnessing
its resources as best it can, and hoping for more funding from the government
to enable the medicines to be made available to New Zealand patients. And, in
all probability, it will continue that way until the next such case arises, and
so on. It is neither satisfactory, nor sustainable.

We need to be
developing a strategic overview of what medicines are likely to be becoming
available in the years to come; what is a reasonable expectation of which of
these medicines New Zealanders might expect to have access to; and, how that
might be funded. In some cases, there may be other medicines available that
could be cheaper and just as effective, while in other cases it might be that
the particular medicines are not of as much value here as might be claimed
elsewhere. And we also need to be brave enough to determine the point at which
long standing medicines should be moved on, either to a part-charge regime, or
to no subsidy at all, because they have been replaced by newer products.

At the present
time, we have no such overview, and, as the Herceptin and Keytruda debates show
painfully, governments have been left to react, when it is often too late. A
more proactive approach focused on what are reasonable expectations for New
Zealanders to have of the national medicines system would enable governments
and PHARMAC to prioritise spending better, and would give patients a certainty
they lack presently.

The limitations
of the current system have been clearly exposed and when in government both the
major parties have struggled to accommodate the demands being made. (Part of
the problem is that when in Opposition both parties have promised everything to
everybody on the medicines front and then become hoist by the own foolish
petard when elected to office. As recent events show, that puerile pattern
seems likely to continue.)

A more strategic
approach would prevent repetitions of that hypocritical tomfoolery, but, more
importantly, would give New Zealanders a greater level of certainty than they
enjoy now.